Crowdfunding: what it is and why it's important

We explore the murky world of crowdfunding

Notably, he mentioned very little about the game itself. $300,000 is a tiny amount in AAA game development (the downloadable games had been working with a budget of $2 million each), but public interest was such that Schafer's project blasted past its modest goal, securing $400,000 in the first nine hours alone. By the time payments had closed a month later, the game had raised nearly $3.5 million from 87,000 backers.

This is still not a huge amount in terms of game development, but it signalled to many other developers that Kickstarter was an alternative funding spot for their games; it completed the breakdown of the publisher-distributor system that had been the bane of developers' lives since the end of Shareware in the 1980s.

With Steam Greenlight and Kickstarter, developers can now fund a game by themselves, promoting it at the same time, and then distribute it (without the fixed cost of manufacturing stock), retaining the majority of the profits for themselves.

The ball and chain

Zombie Playground. Y'know...for kids

"The advent of digital publishing, Steam, the App Store, Google Play and digital downloadable content everywhere is eroding the near monopoly which was traditionally held by the major publishers," says Todd Tribell, co-founder of Digital Capital, a highly specialised investment firm for cutting edge technology.

"As a result of digital downloads, the risk of maintaining $10-20 million worth of inventory one might not sell is now eliminated. Combined, the elimination of the 'ball and chain' as I call them [inventory and console licenses] is, in my opinion, the game-changer here."

Since then, we've seen many indie studios redirecting their efforts towards Kickstarter and many better-known developers leaving studios to go it alone. As Tribell says, "We are in a dynamic time in this industry and the shift has already occurred - past tense. This I attribute from a practical perspective to Harrington and Newell at Valve, and to Steve Jobs, who I believe have collectively had the biggest impact on this transformation in industry politics through the advent of download technology. The reality as I see it: I am in on the ground floor of something that is a virtually brand new industry, and I truly believe that the dynamics of the old titans in the industry are going to have to dramatically change or soon they will be gone - the same I expect to see with the console and the DVD."

Famous developers like Brian Fargo of Wasteland fame, Tim Cain of Fallout (who left his publisher-driven MMO Wildstar) and Chris Avellone of Planescape: Torment have all moved their projects to Kickstarter.

"Look at now versus three years ago," says Fargo. "How many independent studios are carving out businesses for themselves? And we all have different niches. One guy might do a fly-fishing game, or a train simulator. He's got his audience and he sells to them and he's got a great business for himself. We're already seeing a lot of really talented people leaving the publishers to do what we're doing."

Obsidian's Project Eternity hit nearly $4,000,000, again with little initial detail. Fargo's Wasteland 2 hit nearly $3,000,000. Planetary Annihilation (a modern day Total Annihilation) reached $2,300,000. Shadowrun, an old RPG series, got $1,900,000 for a 2D RPG for tablets and PC. Homestuck Adventure, an adventure game based on a popular webcomic, got $2,400,000. A new Broken Sword adventure game got funded ($700,000), despite the last iterations being disappointing. Carmageddon, a long-dead and much-beloved destruction derby game, got $625,000. Neal Stephenson, author of Cryptonomicon and The Baroque Cycle, got $500,000 to make a motion-controlled sword game. And so on.

Notably, either from the start, or in 'stretch goals' - when developers say what they'll do with all their extra cash - many of these developers have pledged to support Linux and Mac games. Given that many of them are developing in the Unity engine, they're aware that, at low cost, they can make ports to other hardware platforms relatively easily.